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Transport Infrastructure Investment and Interindustry Spillovers: The Effects on the Cost Structure of Australian Industries

Author

Listed:
  • Amani Elnasri

    (School of Economics, Australian School of Business, the University of New South Wales)

Abstract

This paper examines the impact of the provision of public transport infrastructure on the cost structure of the Australian economy within a context that recognises industry agglomeration externalities. The paper extends the symmetric generalised quadratic cost functionby incorporating public transportation capital as an external input and adapting the spatial econometric techniques to an industrial context to allow for industry spillovers in the cost analysis. Using industry level data over the period 1990-2010, the paper finds that while public transport has a productive effect in reducing the cost of production, neglecting interindustry spillovers has noticeably overestimates this effect.

Suggested Citation

  • Amani Elnasri, 2014. "Transport Infrastructure Investment and Interindustry Spillovers: The Effects on the Cost Structure of Australian Industries," Discussion Papers 2014-24, School of Economics, The University of New South Wales.
    • Handle: RePEc:swe:wpaper:2014-24
    as

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    File URL: http://research.economics.unsw.edu.au/RePEc/papers/2014-24.pdf
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    References listed on IDEAS

    as
    1. Kelejian, Harry H & Prucha, Ingmar R, 1999. "A Generalized Moments Estimator for the Autoregressive Parameter in a Spatial Model," International Economic Review, Department of Economics, University of Pennsylvania and Osaka University Institute of Social and Economic Research Association, vol. 40(2), pages 509-533, May.
    2. Kam, T.C.Y., 2001. "Public Infrastructure Spillovers and Growth: Theory and Time Series Evidence for Australia," Department of Economics - Working Papers Series 811, The University of Melbourne.
    3. Burnside, Craig, 1996. "Production function regressions, returns to scale, and externalities," Journal of Monetary Economics, Elsevier, vol. 37(2-3), pages 177-201, April.
    Full references (including those not matched with items on IDEAS)

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    Keywords

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    JEL classification:

    • D24 - Microeconomics - - Production and Organizations - - - Production; Cost; Capital; Capital, Total Factor, and Multifactor Productivity; Capacity
    • H23 - Public Economics - - Taxation, Subsidies, and Revenue - - - Externalities; Redistributive Effects; Environmental Taxes and Subsidies
    • H41 - Public Economics - - Publicly Provided Goods - - - Public Goods
    • H54 - Public Economics - - National Government Expenditures and Related Policies - - - Infrastructures

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